Five Essential Tips for Managing Your Personal Finances
If you're interested in a more in-depth article than five essential tips, I encourage you to check out the table of contents, which goes into further detail about each topic.
- Get a high-interest savings account
- In 2007, inflation was about 3%, meaning that your money lost 3% of its value in the year.
- Online savings accounts offer 4-5% interest per year (APY).
- Traditional banks typically offer less than 1% APY.
- ING Direct offers a competitive interest rate and an awesome user interface. If you start an account with $250, ING will give you $25.
- Get a better credit card
- Credit cards are only useful if you use them responsibly by not overspending and paying off your entire bill every month.
- Credit cards will build your credit and protect you if your account is compromised (unlike debit cards)
- Certain credit cards will give you 1-2% cash back on all of your purchases.
- Chase's Freedom Credit Card offers a killer rewards program and will even give you $50 for signing up for their card.
- Consider loaning your money
- Online loan sites allow you to provide three year loans to others who are seeking a superior interest rate.
- Depending on your loan style, you can make about 6-9% APY on your loans.
- Prosper.com is the leading lender website that allows users to offer decentralized loans to other users. You can sign up and get $25.
- Kiva.org is a lending website that loans money to entrepreneurs in developing countries at zero percent interest. They offer loans, not donations.
- Get a stock broker
- Find a broker that has a low enough minimum for your current portfolio and has a low price per trade.
- ShareBuilder.com is an excellent starting point for beginning investors -- there is no minimum, and automatic trades only cost $4. If you open an account, ShareBuilder will give you $25 toward your first investment.
- Zecco.com has a minimum of $2500, but if you meet the minimum, Zecco will give you ten free stock trades each month.
- Educate yourself
- The more you read about investing, the better off you'll be. Websites like The Motley Fool are perfect for learning more about how you can put your money to work.
- For the beginner, I would strongly encourage that you read an article entitled Start investing with just $100 -- it's a great way to begin building your portfolio with ETF's.
I hope my articles have directed you on the path to better financial success, but keep in mind that I have barely scratched the tip of the iceberg. Keep reading and learning! In fact, I would love to hear any more advice that you have to offer via contacting me.
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